Nintendo released its financial results for the fiscal year ending in March 2011 this morning. Besides using the opportunity to tease its next console, the company revealed profit declines due to flagging Wii and DS sales, and shared some sales numbers for the new 3DS.
First, the good news. Nintendo has sold about 3.61 million units of the 3DS worldwide, making for what Nintendo calls a "smooth start" in sales. Though Nintendo was no doubt hoping for more of a breakout hit, the 3DS sales so far seem to be aligning with the company's expectations.
Net income, on the other hand, was significantly lower than company estimates. Nintendo brought in 77.6 billion yen (approximately $946 million), which might sound great until you recall that the company predicted 200 billion yen ($2.1 billion) for the period. This accounts for a 66% drop, which Nintendo attributes to appreciation of the yen and a price drop for the Nintendo DS hardware series.
"The market reaction is likely to be negative, because the profit outlook fell short of the consensus," analyst Yusuke Tsunoda told Bloomberg. "Sales of Wii software are forecast to plunge, while at the same time the company's outlook is probably taking into account a price cut for the console."
For the period ending in 2012, Nintendo expects net income of 110 billion yen ($1.3 billion), and net sales of 1.1 trillion yen. It will "vigorously spread" the 3DS, launch its new eShop, and rely on Wii and DS sales with evergreen titles and the launch of The Legend of Zelda: Skyward Sword.
Nintendo also includes a brief mention of the Japan earthquake, saying the effect it may have is "unpredictable." The company claims it hasn't suffered any direct damage to production facilities, but expects an indirect impact from "individual consumption patterns or economic conditions" in Japan.